A Caspian declaration by Russia and Iran has drawn criticism from Kazakhstan and Azerbaijan. The episode has turned into a diplomatic embarrassment for Moscow and a setback to its plans for dividing the Caspian on its terms. Our correspondent Michael Lelyveld reports.

Boston, 17 March 2001 (RFE/RL) -- A Caspian agreement with Iran backfired badly on Russia last week after both Kazakhstan and Azerbaijan raised strong objections to the deal.

Russia's Caspian envoy, Viktor Kalyuzhny, bore the brunt of the complaints. During a visit to Kazakhstan, he was called upon to explain the declaration made last Monday (12 March) by Presidents Vladimir Putin and Mohammed Khatami in Moscow.

Speaking to reporters in Astana, Kalyuzhny could do little more than admit to what he called "a certain coolness in relations between Russia and Kazakhstan" as a result of the accord with Iran and to offer a series of contradictions aimed at calming tempers down.

The incident is the latest chapter in the decade-long search for a formula to divide the oil-rich waterway among the five shoreline states.

Top officials in Kazakhstan were clearly angered by the Russian agreement with Iran, stating that: "Until the legal regime of the Caspian Sea is finalized, the parties do not officially acknowledge any boundaries on this sea."

Russia and Iran also said that: "The parties openly declare their disagreement to laying any trans-Caspian oil and natural gas pipeline on the seabed. That would be dangerous in the environmental sense in conditions of extreme geodesic activity."

In addition, the two countries stated that: "Any decision and agreements referring to the legal status and use of the Caspian Sea will only have force if they are approved on general consent of the five littoral states." In other words, no oil contracts or bilateral pacts would be considered valid until they were approved by Russia and Iran.

Kazakh Prime Minister Kasymzhomart Tokaev said the statement went against his country's 1998 agreement with Russia on dividing the seabed in the northern Caspian. Tokaev also refused to rule out Kazakhstan's participation in a trans-Caspian line.

On 13 March, an unnamed senior diplomatic source in Azerbaijan raised similar objections, telling Russia's Interfax news agency that Moscow's Iranian pact was inconsistent with its recent Caspian agreement with Baku. The official charged that the challenge to Caspian pipelines was intended only to force oil transit routes to run through Russian or Iranian territory.

Kalyuzhny was at pains to explain that the agreement with Iran would not exclude Caspian pipelines from its neighbors' offshore oil fields, saying, "Russia has not been nor will be against any pipelines, including the Baku-Ceyhan project, if they are economically profitable."

The comment was Kalyuzhny's latest reversal on Baku-Ceyhan. In an interview last month, he indicated that Russia would accept the U.S.-backed oil line because it was no longer seen as competing with Russian interests. Then, earlier this month, he demanded an explanation when Kazakhstan said it would support the project by shipping oil through the line.

Following the embarrassment over the joint declaration with Iran, Kalyuzhny changed course again, saying, "Russia will not try to keep anyone from entering the Baku-Ceyhan project."

President Khatami's historic visit to Russia turned into a fiasco for Moscow on the Caspian issue after the two sides failed to agree on a division formula in time for the trip. Diplomats apparently felt pressured to make some sort of statement on common principles anyway, but found the task difficult because Russia and Iran remain so far apart.

Putin's government spent months trying to marshal support for its plan to divide only the seabed into national sectors while keeping the water and the surface in common. Iran has held out for 20 percent of the entire Caspian, far more than it could get from the area covered by its shore. Russia had succeeded into winning over Kazakhstan and Azerbaijan, and there were recent signs that Turkmenistan might be leaning its way.

Iran's persistence forced postponement of a Caspian summit this month amid predictions that a breakthrough would be made in Moscow first. But the breakthrough never came, and the badly-worded joint statement only succeeded in offending the two countries with which Moscow had already reached accords -- Kazakhstan and Azerbaijan.

After months of playing offense, Russia has now been put on the defensive over its Caspian policy, whether by accident or Iranian design. Before Khatami's visit, Moscow seemed to be gradually isolating Iran on the Caspian issue, but its strategy now lies in tatters. Kalyuzhny has been left to make the case that it was all a big misunderstanding. Russia's neighbors on the Caspian seem likely to agree.